January/February 2014

THE FUTURE

ISSUE

THE FUTURE

ISSUETrendswith Traction

Perry CaiccoMerger Mash-Up

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What’s the future of centre store?

Trends with Traction

grocerybusiness.ca

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THIS IS THE YEAR 2013 THAT WAS

FEATURES15 Shakeup in Aisle 8 What’s the future of centre store?

20 Trends with Traction

23 McCormick Flavour Forecast 24 What Millennials Want The future of retail… Part 2

26 IPSOS: Catch Them While You Can The time is ripe to connect with Millennials

27 Four Generations in the AisleMcontents

DEPARTMENTS4 2013: This is the Year

that Was

8 Front End People & News

11 Open Mike First Impressions… Lasting

Memories!

32 Shelf Life: Reeling in Seafood Sales

56 Launch it, List it New and Now Products

64 It Figures Focus on Loyalty Programs

Grocery BusinessJanuary | February, 2014

Volume 4, Number 1

ON THE COVER

The Future IssueIf 2013 was the year of the acquisition, 2014 is the year of the merger. Perry Caicco analyzes the effects of the mergers on the industry in 2014.

19

PLUS28 extra Special Marc Poulin reveals Sobeys’ new store

strategy

59 BrandSpark Canadian Shopper Study 2014

62 Golden Pencil Awards

Clorox celebrates its 100th Anniversary

62 32

24

59 2822

January | February 2014 7grocerybusiness.ca6 January | February 2014

Front End

John Welling has been appointed senior vice- president of operations for Walmart Canada. Previously, he was a SVP for Walmart Japan

Food & Consumer Products of Canada (FCPC) has promoted Errol Cerit to the position of vice-president, industry affairs, from his previous role as senior director, industry affairs. FCPC also hired Maisie Vanriel as vice-president, scientific and regulatory affairs, food policy.

Her previous experience includes roles as a public health dietitian with the Region of Peel, and a corporate dietitian with Cara Operations Limited.

Robert Sobey has retired as president and CEO of Lawtons Drugs, a position he held for the past eight years. Sobey will continue to serve on the board

of directors of Empire Company Limited. Vivek Sood was promoted to the role of general manager of Lawtons Drugs, from senior vice-president.

Nestlé Purina PetCare Canada has promoted Jeff Hamilton (left) into the position of president. Purina Canada also promoted Todd Cooney to

vice-president, general manager – generating demand, from his previous role as vice-president, sales.

After 32 years with Nestlé Purina PetCare Canada, Karen Kuwahara retired at the end of 2013. Kuwahara was president of the company for 13 years.

Peter McMahon is the new CEO of Shopko, a Green Bay, Wisconsin-based general merchandise retailer. McMahon most recently was the chief operating officer of Loblaw Companies Ltd.

GS1 Canada has appointed two new executives to its board of governors: John LeBoutillier (left), president and CEO of

Unilever Canada; and Grant Froese (right), chief administration officer for Loblaw Companies Ltd.

Nancy Messham recently joined Brand Marketing and Communications Group in an account management and business development role. Messham is known for

her recent work developing the Heart and Stoke Foundation’s Health Check program.

Brandt C. Louie (right) assumes the role of president and CEO of London Drugs and TLD Computers, in addition to his role as chairman, upon the retirement of Wynne Powell (left) from

those positions. Clint Mahlman, chief operating officer of London Drugs, has assumed the additional title of executive vice-president.

Bron Sarabun has joined Brand Momentum Inc. as national client services manager. Sarabun previously worked for H.J. Heinz Company.

Transitions

Front End

Donald Sobey receives the Order of CanadaDonald Creighton Rae Sobey, Chair Emeritus of Empire Company Ltd., has been named to the Order of Canada for his contributions as a philan-thropist and entrepreneur, notably for founding the $50,000 Sobey Art Award, one of Canada’s leading awards for young artists.

A director of Empire since 1963, president of the company from 1969 to 1986, and a director of Sobeys Inc. since 1998, Sobey is the founder of the D&R Sobey Scholarship Fund at Queen's University, past chair of the National Gallery of Canada, past chair of Maritime Telegraph & Telephone, and past director of the World Wildlife Fund.

Welcomes the following new vendors

Co-Publisher and Executive Editor Karen James [email protected]

Co-Publisher and Content DirectorKevin Smith [email protected]

Executive Vice-PresidentContent and Market DevelopmentDan Bordun [email protected]

Contributing Editors Angela Kryhul, Sally Praskey

Contributing WritersPeter Diekmeyer (Montreal) [email protected], Marjo Johne

Contributors Perry Caicco, Michael Marinangeli, Catherine Yuile

Creative AgencyBoomerang Art & Design Inc.boomart.net

Subscription changes & updates or general inquiries: [email protected]

Grocery Business Advisory Council

Phil Donne, Campbell Company of Canada

Tom Barlow, Canadian Federation of Independent Grocers

Perry Caicco, CIBC World Markets

Chris Terrio, CROSSMARK Canada Inc.

Nancy Croitoru, Food and Consumer Products of Canada

Tim Berman, Kraft Foods Canada

Michael Marinangeli, MIDEB Consulting Inc.

Cheryl Smith, Parmalat Canada

Mark Ayer, Procter & Gamble Inc.

David Wilkes, Retail Council of Canada

Cori Bonina, Stong’s Market

© Copyright 2014. All rights reserved. No part of this magazine may be reproduced without written permission of the publisher. GST Registration No. 83032 6807 RT0001 Publications Mail Agreement No. PM42211029 ISSN 1927-243X

Mailing AddressGrocery Business Media 390 Queen’s Quay W., PO Box 40085 Toronto, ON M5V 3A6

January | February 2014Volume 4, Number 1 @grocerybusiness

January | February 20148 grocerybusiness.ca

Front End

First impressions...Lasting memories!By Michael Marinangeli

Today’s retailers are facing many challenges – new entrants, channel blur, industry consolidation, ethnic store growth, ad matching, changing demographics, online shopping, square-footage growth, deflation, and smartphone apps, to name just a few.

For many retailers, this is uncharted territory. In the previous decade, we had a robust economy, a healthy consumer market, and fewer competitors vying for consumers’ dollars. Sales and margins headed in one direction only. Up! The rapid expansion of discount was lucrative and viable, since the conventional stores owned the discount formats and could control both sides of the equation when it came to margins and price gaps.

Over the past five years, however, competitors with deep pockets and a venue for discount pricing rolled into town. Square footage was added – whether or not it was warranted – and margins declined. Conventional stores started to suffer major sales erosions as consumers flocked to discount stores and bought items only when they were on special. Christmas turkey prices in 2013, for example, were lower than they were 30 years ago. There was a time when there was a correlation between product acquisition costs and retail prices, but today’s pricing

strategies follow a different set of criteria. Losing plenty of money on loss leaders seems to be the norm.

We have experienced a major paradigm shift in our industry that will last for many years. So, is the glass half full or half empty? Let’s be optimistic and take the half-full approach.

I spend a lot of time visiting stores. I see plenty of great retail execution. However, I also see plenty of lost opportunities. Here’s an actual story to illustrate my point.

A few months ago, I visited two stores within a three-mile radius of my house. I read the ads for each store the night before and planned my purchases based on its features. Store A is a discount store; Store B is a conventional store.

As I pulled into the busy parking lot of Store A, a massive outdoor display of 10-inch hanging flower baskets, retailing for $6.99, caught my eye. This was the hottest price in town. Customers were buying three or four at a time. Upon entering the store, I saw many customers reading the weekly flyer as they shopped. The store was running a dollar sale that week, and shoppers were loading up on the bargains.

Open Mike

The grocery industry is experiencing pressures not seen in more than three decades. We’ve gone from the land of milk and honey just a few years ago to a rapidly changing and far more competitive environment.

The St. Anthony Grenfell Memorial Consumers Co-operative Society in Newfoundland recently celebrated its centennial. One of Canada’s oldest consumer co-operatives, it began as a Spot Cash store back in 1908 before becoming a Co-op in 1913.

Grenfell Co-op is named in memory of its founder, Dr. Wilfred Grenfell, who died in 1940. Believing the local fishermen were not getting a fair deal with the merchants, the physician started the co-op movement in northern Newfoundland and Labrador.

“Dr. Grenfell was a humanist and a great community leader,” says Léo LeBlanc, corporate secretary and vice-president of human resources and corporate affairs at

Co-op Atlantic. “He established the foundation for co-operative efforts that would be embraced by the people of St. Anthony.”

While Grenfell Co-op suffered financial hardships in the 1930s due to competition and new regulations that forced it to buy back the shares of non-residents, it survived and eventually thrived. The Co-op now boasts some 3,500 members, up from the original 28 shareholders.

In 1978, the Co-op moved into its current building behind the former store (known as the Clock Shop because of the distinctive clock tower) and began selling more groceries. It has undergone several renovations over the years.

To mark the milestone, the store held a series of community events and promotions throughout the summer.

“It is a privilege to be a part of Grenfell Memorial Co-op’s family,” says manager Boyd Manuel. “The fact that the oldest consumers’ co-op in Newfoundland and Labrador is in our area is something we should all take pride in. It is a part of our heritage, as well as a part of Dr. Grenfell’s legacy.”

GRENFELL MEMORIAL CO-OP CELEBRATES A CENTURY OF SERVICE By Sally Praskey

The current Grenfell Co-op was built in 1978 behind the former store, known as the Clock Shop due to its distinctive clock tower

(continued next page)

January | February 2014 11grocerybusiness.ca

The key feature items were prominently displayed along with related items for increased sales and margins. I had planned on spending only about $10 at this store. Instead, I spent over $100, including six hanging baskets that I told my neighbours about. Nice things happen when you have the right items, at the right price, in the right quantities. I have a great first impression and lasting memory of this store.

My visit to Store B yielded a far different first impression and lasting memory. About 25 hanging baskets were on display at the front entrance, priced $4 higher than those at Store A, although the quality was comparable. My first impression was that this store was high-priced and not a destination for seasonal merchandise.

I headed for the store’s bakery to buy a baguette, and was alarmed to find none in the counter. It was 9:30 a.m. on a Friday morning and this department wasn’t set for business. My next stop was the meat department, where the lead feature that week was top sirloin roast. Much to my surprise, there were none in the counter and no employee around to ask about it. As I walked to the checkout

(there was only one lane open and one customer), I noticed that the first front-end display was 12-pack canned pop at $6.29. That is prime real estate to showcase lead ad items for price image and sales. You never merchandise regular-priced items on your #1 end, especially a highly promoted category like soft drinks.

My lasting memories of Store B: uncompetitive seasonal merchandising; not ready for business when the store opened; out of stock on advertised items; high prices; few customers.

My point: Despite what happens in the marketplace, first impressions and lasting memories fall under your domain if you own or operate a store.

You can meet today’s retail challenges head-on by delivering on the basics that enhance the consumer experience:

» Make sure your store creates great first impressions and positive lasting memories;

» Work at selling your customers more when they’re in the store; » Have solid merchandising standards, practices and disciplines;

» Be ready for business when the store opens; » Be competitive on seasonal items; » Ensure your employees are engaged in their

job and take pride in their work; » Improve your in-stock position on both

advertised and shelf items; » Visit stores in your trading area so you know

what your competitors are doing, and develop plans to compete with them more effectively;

» Make sure displays are well stocked and well signed, with great cross-merchandising for sales and profit enhancement;

» Improve your overall value proposition; » Ask your customers what you are missing

and how you can improve. Do something about it!

It’s not all doom and gloom. Yes, the competitive pressures today are immense, but by satisfying the needs and wants of your existing customers, you can build a solid foundation for retaining them and attracting new ones.

Open Mike

Michael Marinangeli is a principal at MIDEB Consulting Inc. and a retailing veteran with more than 40 years of experience. [email protected]

As the world leader in store technology, Toshiba understands that mobility represents the most significant challenge – and the

greatest opportunity – facing the modern retailer. How can you give your customers a seamless experience, whether they’re

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SHAKEUPIN AISLE 8

While wide-ranging predictions abound, Tom Barlow, president and CEO of the Canadian Federation of Independent Grocers, cites statistics showing online grocery sales doubling every year for the next five

years to reach about 10 to 12 per cent. Equally bullish on the prospects, Bill Bishop, chief

architect of Chicago-based consultancy Brick Meets Click, says more than one in 10 consumers in the U.S. are already buying some groceries online, according to the company’s recent study Six Degrees of Digital Connections: Growing Grocery Sales in an Omnichannel World. Bishop expects online grocery sales to grow to at least 10.7 per cent by 2023. Centre-store products will likely represent a significant percentage of that total.

Others are not convinced. Conceding that online grocery shopping will indeed have a place in the marketplace, retailing veteran Michael Marinangeli, a principal at Toronto-based MIDEB Consulting Inc., believes it will represent a very small percentage of business – minor in comparison to other competitive challenges grocery retailers have faced over the last five years. “I don’t see it as a big threat,” he says. He contends grocers should focus their efforts, at least

in the short term, “on improving their in-store offering today.”

Interestingly, in U.K. supermarkets – ground zero for online grocery shopping – grocers have been less affected than is expected in North America, says Stephen Mader, director of digital retailing for Kantar Retail in the U.K. That’s because the online evolution in the United Kingdom began with supermarkets that owned both the in-store and online shopper experience, while in North America, online sales have been dominated by Amazon, a non-bricks-and-mortar retailer, leaving traditional grocers to play catch-up.

“There is still enormous risk of the physical centre store being disrupted by tactics like automatic replenishment of big, bulky, predictable items,” Mader says. “Pet food, paper towels, toilet paper, cleaning products, and health and beauty products are all potential movers online.”

However it plays out, online shopping isn’t about to fade away as several high-profile players, who were perhaps ahead of the curve, did in the dot-com bust of the early 2000s.

“I think it’s a fundamental shift in the business model and in how consumers behave,” says Jennifer Lee, partner, national digital and omnichannel leader, Deloitte.

WHAT IS THE POTENTIAL OF ONLINE GROCERY SHOPPING?

Source: Online Grocery Shopping is Going to Reach $9.4 Billion. You Should Care. – buxtonco.com

39%of adults want grocers to deliver their orders

TOM BARLOW

As behemoths like Amazon.ca and Walmart.ca extend their brand experience to online grocery sales, the centre store of traditional supermarkets may be coming under siege.

But grocery e-commerce need not portend doom and gloom. Grocery Business takes a look at the implications.

By Sally Praskey

“It’s an interesting time to be in retail. How many times in our lifetime will the consumer change this drastically?”Jennifer Lee, Deloitte

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Bill Bishop of Brick Meets Click believes the greatest opportunities lie in two major areas:

• Specialty products and local products that are unique.

• Subscription models. “The subscrip-tion model could be very easily fulfilled by a store.” He notes that the average household doesn’t buy more than 300 different UPC products in the course of a year, although the average store carries between 10,000 and 30,000 items.

Many grocers are carrying a limited quantity of high-use items for the convenience of customers, “but they can’t play the pricing game that’s going on,” says Barlow. “They’d love to because those are usually high-margin items and brand names that consumers know and want. But I think we’re seeing a shift into more of the experience within the store, which means it’s more around the fresh, the produce, the bakery, meat and deli offering.”

Bricks-and-mortar retailers must add value to the shopping experience beyond price, Mader concurs, citing the Loblaws store at the former Maple Leaf Gardens in Toronto as an example of a large store adding a more experiential perimeter.

“We’re starting to see retailers really understand which SKUs, at which pack sizes, are needed in each of their store formats,” says Mader. “For an immediate/urgent need, a small local express store, like a Sobeys Urban Fresh or a Shoppers Drug Mart, would fill that need – small pack sizes to hold the shopper over until their large bulk pack is delivered.”

Barlow says that grocers will make adjustments to their centre-store offerings by carrying different sizes or varieties. “Bigger packs will potentially go through other modes of delivery.”

HOW ARE GROCERS RESPONDING?

WHAT ARE THE OPPORTUNITIES?

The trend to e-commerce can represent a significant opportunity for grocers, particularly independents.

“If you are a small to medium-sized grocer, you have a huge competitive advantage because you’re much more nimble, and online is all about being nimble,” says Lee. “The advantage for all of these grocers is you can act like a big player when you’re a small player.”

Online doesn’t have to mean home delivery; there are many fulfillment models (see "Takin’ it to the Streets," Grocery Business, July/August 2013, page 56). “There are a large number of possibilities, and they’re all kind of white spaces for entrepreneurs,” says Bishop.

He has recently introduced a service to help grocers evaluate the readiness of

their market for online shopping, based on the demographics of the population.

Grocers who choose to compete in online should treat it as part of their overall marketing plan, rather than as a separate function, says Barlow. Independents need to capitalize on what they can offer that a large company like Amazon cannot.

“I think what they can offer is a store you can go into with people you can talk to,” he notes. “The local independent retailer has built those relationships, and I think that is the advantage they’re going to have.”

WHAT ARE MY OPTIONS?

JENNIFER LEEDeloitte

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STRATEGIC LEADERSHIP

COFFEE

STRATEGIC LEADERSHIP COFFEE

One of the most popular beverages in the world, coffee has been

transforming itself with the arrival of the new single serve brewing

systems. Consumers are adopting the single serve technology for its

convenience, quality and freshness. This evolution will be transferred

to even more categories, expanding beyond coffee and bringing

growth along the way. Meanwhile, “traditional” coffee drinkers are

also evolving toward premium coffees, looking for origins, fair

trade or particular bean blends. Seizing these opportunities

and adapting their on-shelf merchandising will be key for

retailers to seize their share of this growth.

COFFEE: Single Serve Sales Soar


+50%

RegularTea

Traditional Coffee

Instant Coffee

Regular Hot Chocolate

Coffee Whiteners

Coffee Filters

Coffee Substitutes

-1% -1% -5% -5% -6% -8% -11%

Single ServeBeverages

Single Serve Coffee 28%

Single Serve Hot Cocoa 0.7%

Single Serve Tea 1.6%

Traditional Mainstream 28.3%

Instant Coffee10.5%

Regular Hot Chocolate3.0%

Regular Tea 13.2%

Coffee Filters 1.6%

Coffee Whiteners 1.8%

Coffee Substitutes 0.1%

Traditional Premium 11.1%

30.4%Last year

was at 20%

Source : Nielsen MarketTrack (Coffee excluding Bulk Coffee) and ACNielsen Strategic Planner (Other Categories), All Channels, latest 52 weeks ending October 19th 2013

SINGLE SERVE IS FUELLING HOT BEVERAGE GROWTH NATIONALLY

$ GROWTH %

Coffee has the highest penetration after tap water,

at 65% of the population(1)

Coffee category represents sales of more than

$1,000,000 per year (Nielsen market track, 52

weeks ending Nov 16th 2013, national all channels)

The growth of the category is still one of the

highest sources of $ gains in grocery, with a

growth of 9%, driven by the single serve segment,

which is adding value to the category with a

growth of 48%

There is an opportunity in the traditional cans

& bags format to trade up transactions to Premium

coffee, which performs better.

$ SHARE

2011 2012 2013

SINGLE SERVE BRINGS ADDITIONAL SALES INTO THE COFFEE CATEGORYVOLUME ($) OF THE COFFEE CATEGORY

1,200,000,000

1,000,000,000

800,000,000

600,000,000

400,000,000

200,000,000

TL Single Cup TL Traditional Coffee

Source : Nielsen Market Track, National +Drug+ Mass Merch+Gen

Merch+Warehouse Club, $ sales; 52 weeks ending October 19th 2013

2013GROWTH OF

9%

(1) Source: 2013 Canadian Coffee drinking Trends, Coffee Association of Canada

SINGLE SERVE SYSTEMS’ IMPORTANCE IS REFLECTED IN THE COFFEE CATEGORY

The importance of single serve systems is reflected in the coffee category one year later

Share(unit) of single serve brewing systems

Share($) of single serve coffee

2011 2012 2013

25%

75%

40%

60%

16%

84%

30%

70%

47%

53%

42%

58%

Traditional Coffee

Single Serve Coffee

Single Serve Brewing Systems

Auto-Drip/Espresso Coffee Makers

Single Serve RevolutionWhat is single serve?Why do people choose single serve?

Quality comes first!

It makes a great tasting coffee

The K-Cup® packs, disc or capsules

are easy to find

It’s easy to keep clean

It brews fresh beverages

Offers good value for the money

BREWERS SALES HAVE A DIRECT INFLUENCE ON SINGLE SERVE BEVERAGES

Source: Nielsen Market Track, National +Drug+ Mass Merch, $ sales; Brewers: NPD, Unit sales, National, NPD estimated to represent 74% of the retail market.

120,000,000

100,000,000

80,000,000

60,000,000

40,000,000

20,000,000

$ 0

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25, 2

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300,000

250,000

200,000

150,000

100,000

50,000

0 Units

SINGLE SERVE COFFEE SALES IN $SINGLE SERVE BREWER UNITS

Back-to-school and Holiday season bring

new consumers in the single

serve systems

Many consumers buy their brewers outside of grocery, but the advantage this channel has is frequency of visits. Grocery stores should ensure that they capture the attention of these potential new customers by having an attractive single serve section (product offers, signage and displays).

Single serve’s importance will continue to increase in the next year, and single serve offer will expand to other categories. Particular attention should be given to this category to make sure it’s allocated the APPROPRIATE SPACE, considering the growth and the profitability.

Source: CROP - U&A, March 2012

Source: Brewers: NPD National All Channels , 52 weeks ending October 2013, estimated to represent 74% of the total market; Coffee : Nielsen Market Track, National GB+DR+MM+GM+WC, 52 weeks ending October 19th 2013.

Iced Tea/Coffee 5%

Coffee 16%

Tea 11%

Hot Chocolate 2%

Alreadycovered

1

2

Increased Consumption = Increased SalesOnce consumers have a single serve brewer on their

counter, the goal is to INCREASE their consumption

per brewer. To achieve this goal, single serve is

expanding the offer outside coffee to: Capture

more household member usage, Provide

opportunity to increase occasions and Increase

consumption throughout dayparts.

INCREASE CONSUMPTION THROUGHOUT DAYPARTS

FIRST THING IN THE MORNING

WITH BREAKFAST

LATE MORNING

WITH LUNCH

AFTERNOON

WITH DINNER

EVENING

Caffeinated CoffeeDecaffeinated Coffee

Decaffeinated Coffee

Espresso

Tea

Flavoured Coffee

Flavoured Coffee

Tea Hot Cocoa

Flavoured Coffee

Iced BeverageIced Beverage

Share of daily consumption by beverages

OPPORTUNITY TO INCREASE OCCASIONS

Hot Cappuccino/Latte 2%

Water 22%Juice 11%

Pop 10%

Sport Drink 1%Energy Drink 1%

Alcoholic Beverages 6%

Milk 12%

Other 1%

Source: 2013 Tea Time survey (TAC), Nielsen, weekdays, 7843 respondents in Canada

CAPTURE MORE HOUSEHOLD MEMBER USAGE

By expanding the offer and highlighting new products,

grocery stores can capture incremental sales.

EXAMPLE: A household could regularly buy coffee and

add tea for the mom, hot chocolate or iced tea for the

kids, decaf or different coffee blends for the guests

when entertaining at home.

3

3

1

2


COFFEE MERCHANDISING TIPS

NEW BUYERS: They are consumers who were not consuming coffee

last year. They can be new coffee drinkers who enter

the category buying single serve, not going through

traditional coffee first. They can also be consumers

who were buying away-from-home.

INCREASED CONSUMPTION: Single serve coffee allows consumers the convenience

of having a perfect cup of coffee rapidly, while also

keeping coffee fresh, since it is individually packaged.

This benefit encourages consumers to carry more

types to fulfill the different tastes of family members

or to offer to visitors (i.e. : Decaf, flavoured, different

roast). It diminishes the risk of throwing out non-used

products.

TRANSFER FROM ANOTHER TYPE OF COFFEE: There is a part of the single serve growth that is

coming from traditional or instant coffee users

switching to this new technology, proving that

consumers are willing to pay a higher price for the

product benefits. These transferred sales pay off

for retailers, as single serve products generally bring

higher margins.

(1) NPD Group/Consumer Tracking Service, National all channel, 52 weeks ending June 2013

THERE ARE 3 MAIN SOURCES OF GROWTH IN THE SINGLE SERVE SEGMENT:

Multiple sources of growth in single serve

OF COFFEE DRINKERS REPORT DRINKING MORE OFTEN AT HOME

50%

25% OF THEM HAVE REDUCED THEIR “TAKE-OUT” PURCHASES (1)

• Allocate proper space to the Hot Beverages

categories, which are one of the fastest

growing categories in the centre store.

• Dedicate a section to single serve products;

should now be considered on its own.

(The gold-standard section is 16 feet long)

• Single Serve section should be located between

coffee and other hot beverages, as many hot

beverages are offered in single serve format.

• Conventional banners should still have a

Premium/Specialty coffee section to

differentiate (Bulk coffee, espresso, whole

beans, regional, etc.).

MERCHANDISING IN SINGLE SERVE SECTION

Products on shelf should be regrouped by:

• Brewing system like Keurig® and TASSIMO (Every single serve brewing system has its own format of container. They are not compatible with each other.)

• Type of beverages (highlight outside coffee categories to increase awareness and impulse sales)

• Brand

• Price Tier (allow consumer to understand the offer in the category)

IF 2013 WAS THE YEAR OF THE ACQUISITION, 2014 IS THE YEAR OF THE MERGER

MERGERMASH-UP

MERGERMASH-UP

For Loblaw and Sobeys, acquiring their new

businesses (Shoppers Drug Mart and Canada

Safeway, respectively) required nerves of steel, deep

pockets and no small amount of gamesmanship.

Those efforts, however, will pale in comparison to

the actual integration of these companies.

Grocery Business: Perry, how do you think these mergers will play out?

Perry Caicco: In every merger in every industry, the acquiring company characterizes the acquired company as a “strong strategic fit” with a “great culture” and “excellent management.” Then, as often as not, the integration becomes problematic. The new company proves difficult to integrate and seems culturally incompatible. Key management is pitched out, and write-downs are taken. We do not expect that to be the case in the Loblaw

Perry Caicco, managing director for CIBC World Markets, analyzes the effects of the mergers on the industry in 2014.

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THE FUTURE ISSUETHE FUTURE ISSUE

and Sobeys situations, but stakeholders should be aware that neither merger is likely to go exactly as planned.

GB: And what about the multiples?

PC: The hefty multiples paid for these assets (11.6x EBITDA for Shoppers and 11.3x EBITDA for Safeway) mean that the cost-saving (“synergy”) targets of $300 million and $200 million, respectively, must be achieved to make the deals pay out financially.

In the world of synergies, there are easy synergies, such as jacking bigger rebates out of suppliers, the difficult synergies of downsizing offices and distribution assets, and the ephemeral synergies of boosting sales at the acquired company, cross-pollinating ideas, etc.

In order to realize some of the easy synergies and all of the difficult ones, systems integration is a necessity. The acquiring companies each

have long and sometimes checkered histories with their own IT developments, so it would not be unreasonable to predict that seamlessly and quickly blending the operating systems of the new companies into the old ones will not happen without some unforeseen complica-tions or some unpredicted delays.

Head offices can have wildly different structures (often due to the embedded IT situation), and logistics can be wholly incompatible. Decisions have to be made around private-label products, store banners, loyalty programs, compensation systems, management layers, talent retention, and stakeholder communication.

As well, stores will have to be divested, opening another tremendous opportunity for Canada’s famous independent grocers (Asian and non-Asian) to grab some cheap and easy market share.

Although each acquisition comes with some sort of long-term vision, often invoking themes such as health and wellness, fresh-ness and convenience, and a dream of national dominance or footprint, those visions will take years, not months, to be achieved. As always, the key will be, not in the strategy, but in the day-to-day execution.

There will be no shortage of minutiae and meetings and memos and policies and consul-tants and cut-overs and black Fridays and unintended consequences. And all the while, the businesses need to maintain their competitive positions in the marketplace.

GB: So, what can the industry expect in 2014?

PC: In light of all this, 2014 could be a year of frustration and confusion for many grocery industry participants. The two largest Canadian grocery distributors will have their hands full dealing with this integration.

RETAIL AS ENTERTAINMENT: THE IN-STORE EXPERIENCE BECOMES THEATRE

The lines between entertainment and shopping continue to blur. To make the in-store experience more engaging, and to combat the threat of online shopping, grocers are experimenting with a variety of strategies: products offered in-store only, events and promotions.

For example, Loblaws at Maple Leaf Gardens and Sobeys extra store attract customers who are willing to spend more on a great food experience.

The challenge for grocers will be to roll out that level of excitement to their broader store base in a cost-effective way.

With online shopping already becoming mainstream, the Grocery Business team has identified 10 additional retail megatrends that will impact your business in 2014 and beyond.

SOCIAL MEDIA WILL DISRUPT CONSUMER BUYING PATTERNS

Social media’s power to influence what people buy is widely recognized, and in 2014 it will also influence what retailers sell. For example, message-board-style website Pinterest stands to be the dominant social-commerce platform, according to the newsletter Social Media Insights. A highly visual site, Pinterest attracts mainly women users who keenly share their posted images with their networks.

AS PINTEREST USERS MOVED FROM BROWSING TO PURCHASING, RETAIL SALES ON CYBER MONDAY, 2013, GREW BY 260%

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OMNI-CHANNEL WILL REQUIRE A SINGLE CUSTOMER VIEW TO PROVIDE A SEAMLESS SHOPPING EXPERIENCE

Retailers understand that shoppers often interact with their banners through multiple channels, but what actually happens along this journey can be a mystery. On any given day, a shopper could experience the brand on a variety of devices and across multiple platforms. For example, the successful launch of Longo’s, Loblaw’s, and Sobeys’ mobile shopping apps signaled that customers are primed to take advantage of coupons and recipes designed just for them while shopping in-store.

In 2014, a priority for retailers will be to connect the dots between the various channels in order to personalize and enhance the shopping experience.

STORES AS LIVING WEBSITES

Staples recently launched two “omni-channel” smaller-footprint stores with an edited but well curated product selection, supplemented by in-store kiosks where customers can order product with free next-day delivery. The strategy is to turn the stores into a 3-D version of the retailer’s website.

DATA ANALYTICS WILL ALLOW RETAILERS TO IMPLEMENT DYNAMIC PRICING AND LOCATION TARGETING (GEO-FENCING) TO TAKE ONLINE PERSONALIZATION IN-STORE

Through the opportunities provided by big data and location-based technologies, grocers can tailor and personalize their consumer offers. This dynamic pricing will help alleviate the downward pressure on margins by allowing retailers to make strategic adjustments in order to maximize ROI per customer. For example, driven by real-time data analysis, Amazon is able to change prices 2.5 times each day.

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TRENDS WITH TRACTION

CONTINUED FROM PG. 19

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THE FUTURE ISSUETHE FUTURE ISSUE

SPICING UP SALES IN-STORE

• Place feature recipes on stands beside the spice rack and next to the ingredients.

• Inspire creativity by positioning complementary ingredients that may not be apparent to mainstream consumers.

• Conduct cooking demonstrations and consumer tasting events to highlight this year’s flavour trends.

IN HER OWN WORDSCARLA COOPER, CEO, DAYMON WORLDWIDE

Retailers across the globe are facing a more fascinating, challenging business landscape than ever before. We under-stand that decision-makers in our industry are dealing with contradictions that are hard to reconcile. These include:

• Trying to successfully serve the different needs and preferences of both the large aging population and the tech-enabled Millennial group;

• Managing physical stores while tending to the explosive growth of non-store based retail;

• Meeting consumer needs for conve-nience in products, services and formats that allow them to quickly get what they need while also enjoying the customized retail experiences they've come to expect and will demand.

Each of these challenging realities will have tremendous impact on the retail landscape in 2014.

GROCERY STORES ARE THE NEW KITCHENS AND RESTAURANTS

Shopping trips are taking place on a more frequent, as-needed basis, supplanting the traditional weekly or monthly stock-up. Consequently, the grocery store is becoming a substitute kitchen (and often a preferred choice over quick-serve restaurants), where consumers are increasingly inclined to purchase a ready-to-eat dinner to take home.

Sources: JWT, The Hartman Group, Australia Business Review, Advertising Age, Daymon Worldwide

BIG BOXES WILL CONTINUE TO GET SMALLER

As the population ages and consumers look for a more personalized retail experience, smaller store formats are on the rise. Even the largest bricks-and-mortar retailers realize that their stores can’t compete with the enormous inventory Amazon has access to.

Walmart’s Neighborhood Markets, Sobeys’ IGA Express, and Target’s CityTargets are reflections of this trend. And as people move into urban centres, a “Main Street” type of retail experience will become even more prevalent.

CONSUMERS ARE INCREASINGLY AWARE OF FOOD WASTE

Root-to-leaf cooking, repurposing leftovers, and composting food scraps at home are becoming a way of life for an increasing number of consumers, and they will expect grocers to follow similar sustainable practices. Food Waste Awareness Weeks, initiated in the U.K., are spreading around the globe. LOCALLY SOURCED

HAS SIZZLE

Buying local ties into consumers’ desire for unique products offered in a stimulating retail environment with a neighbourhood feel. To tap into the consumer’s appetite for a local food experience, Whole Foods Market is substantially increasing the amount of low-interest loans it is making available to more than 100 growers, producers, and food artisans.

MILLENNIAL SHOPPERS WILL EXERT GREATER INFLUENCE ON THE MARKETPLACE

As the Millennial cohort enters parenthood, they will demand that the products they buy for their children reflect their ideals of transparency and social consciousness. Products that are clearly labelled, ethically sourced and organic will move to the top of their shopping list.

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A TASTE OF THINGS TO COMEThe McCormick 2014 Flavour Forecast identifies five culinary trends that are heating up worldwide

McCormick & Company, Inc., left no stone unturned – or taste trend unexplored – in researching its 2014 Flavour Forecast.

“The Flavour Forecast is a global annual report . . . that identifies emerging culinary trends and techniques that will find their way to Canadian tables, and inspire creative and delicious innovation,” says Dina Clark, vice-president, marketing, McCormick.

To develop the report, McCormick consulted researchers, trend trackers, marketing experts, chefs, culinary experts, food technologists, and sensory scientists around the world, says Clark, “who serve as a catalyst for driving flavour innovation throughout the food industry.”

FLAVOUR ON FIRE: CHILES ARE HOT

Beyond discovering new varieties, the obsession with chiles has extended into using techniques like grilling, smoking, pickling, fermenting, and candying to tease out their flavour potential. Chiles to watch: Guajillo, mild Mexican dried chile; Chile de Arbol, bold Mexican chile; Tien Tsin, hot Sichuan chile; Aji Amarillo, hot Peruvian yellow chile.

MODERN MASALA: INDIAN CUISINE CURRIES FAVOUR

Already familiar with basic curries, consumers are exploring more flavours in new contexts, from food trucks to fine dining. Flavours of the future: Kashmiri Masala Northern Indian spice blend, Paneer cheese, Jalfrezi stir-fry-style curry dish.

COMPACT COOKING: BIG FLAVOUR FROM SMALL SPACES

As the movement to more efficient, compact kitchens grows, urban dwellers are discovering creative, cross-functional ways to prepare tasty meals making the most of what’s available. Must-have ingredients: tea, noodles, cilantro/coriander.

MEXICAN FARE: BRIGHT AND BOLD

From a growing taste for regional Mexican fare in North America, cultures around the world are embracing authentic elements of the bright, bold, and casual cuisine. Flavours to explore: chamoy (condiment), recados (spice pastes), tomatillos.

TASTE OF BRAZIL: WELCOMING THE WORLD

Rio de Janeiro will host the 2014 World Cup and 2016 Olympics, illuminating the flavours of a dynamic melting-pot culture that includes European, African, Asian, and native Amazonian influences. Brazilian tastes are poised to emerge as a powerful influence. Ingredients on the rise: cassava flour, black-eyed peas, guava, Tempero Baiano seasoning blend.

FL AVOURS IN FAVOUR59

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MalJana Masiewich,

Director, lifestyle marketing, TEN81 Lifestyle Inc.

Cheryl Smith Executive vice-president, sales & merchandising Parmalat Canada

MODERATOR

Peter Neal Co-owner Neal Brothers Foods

Paul Del Duca Former general manager, Ontario Sobeys Canada

Jesse Jones President & chief innovation officer TEN81 Lifestyle Inc.

Health Trends

Technology & New Media

Lisa Zdunich Director business development Tree of Life

James SavageAge: 24Profession: Financial Services Residence: Downtown Toronto

Kate RobichaudAge: 32Profession: Real Estate Agent Residence: Burlington, Ont.

Michelle ThansinghAge: 26Profession: MarketerResidence: Downtown Toronto

THE MARKETERS THE MILLENNIALS

Cheryl Smith: Millennials are asking for access to information, right at their finger-tips. They’re information hungry and they’re using their smartphones to shop. Millennials are going to find the information they want, one way or another. If not from your brand, then from another brand.

INSIGHT

Grocery Business magazine and TEN81 Lifestyle Inc. invited a group of Millennial consumers, as well as some of the industry’s leading retail and consumer packaged goods executives, to discuss shopping attitudes and preferences. Learn how this health-conscious, information-hungry and community-minded generation is impacting the future of grocery retail.

How important is the concept of health in your food choices?

Michelle: I try to eat healthy. At lunchtime, I will buy food from a naturopathic clinic near me instead of going to a fast-food chain. I still indulge, but I’m pretty aware of the ingredients on labels.

Peter Neal: Do you shop the health section at a Loblaws or Metro?

Michelle: Yes, but it’s probably my last stop in the store. I may swap some items out, but usually if the price of what I already have in my cart is lower, I will stay with that item.

Paul Del Duca: I believe in having the ethnic and health sections integrated as part of the offer because it gives shoppers more choice up and down the aisles, as opposed to having to go to separate sections.

Do you purchase gluten-free products?

Kate: Yes, but not exclusively. I’m trying to cut back on gluten with all of my meals because of the research about gluten not being good for your body.

James: I’ve never had a problem with gluten and I haven’t switched over to gluten-free foods.

Michelle: I feel that I’m influenced by the people I work with and some of my friends. Many of my friends have dietary restrictions, whether it’s dairy-free, gluten-free or vegetarian.

What Millennials WantThe Future of Retail – Part 2

Paul Del Duca: Grocers are going down the path of offering prepared meals. Are you interested in ready-to-eat meals?

Kate: Yes, but I want to know what's in it and how it was prepared. I want to make sure it's healthy.

James: I will occasionally buy a whole chicken at the prepared food counter. I would definitely be more inclined to buy a fresh sandwich [at a grocery store] if it was put together for me right on the spot, like they do at a sandwich shop.

Ready-to-eat

How could grocery retailers create a better shopping experience for you?

Michelle: I have every intention of planning my meals, but sometimes I feel very overwhelmed when I’m in a store. If there was an app on my phone or something in the store to help guide me to ingredients... that would make me more efficient and probably save me more money.

Kate: Access to information, knowing where my food is coming from, and more information about the products. If stores had a little section that showed how to use kale, and displayed everything you need to make a meal, including recipe cards… that would be interesting.

Convenience & Information

INSIGHT

How does technology factor into your grocery shopping decisions?

James: I wouldn’t necessarily shop online for groceries. I like to go and see the product, feel the packaging. But if it was something unique that you can’t get in too many places, then, yes, I would buy it online.

Michelle: If it’s something like toilet paper that I can have shipped, that’s fine. But I’m not swayed to shop online for groceries. I’m very at-shelf. If I was in store and I had a GPS location pop up, I might be annoyed. But if it was targeted to me based on what I’ve purchased in the past, that would be okay.

Jesse Jones: If you look at the advancements in technology and digital, and the multiple ways that Millennials engage on any given day, it means you have to look at this demographic a lot differently than you would the previous generation.

Is social media having an impact on your purchases?

James: Definitely social media, blogs… I don’t ever look at flyers. Word of mouth is big. I will try something new at [a friend’s] house, then go home and make it for myself.

Michelle: Social media in the sense that I look at recommendations… I can be swayed by a recipe online. I like to see people’s food pictures. I look at flyers.

Lisa Zdunich: The need for convenience came through loud and clear. Simplify, make things easier, better represent different areas of the store, help people to understand where their products are coming from, help them to plan their dinners.

Visit grocerybusiness.ca to read Part 1 of our Millennials Forum (published in the November/December 2013 issue), and to watch a series of videos, created by TEN81 Lifestyle, recapping the key insights from the event.

January | February 2014 25January | February 201424 grocerybusiness.ca

MILLENNIALS ARE MORE LIKELY TO BE PROACTIVE RECIPE USERS, SEARCHING FOR NEW RECIPES EVEN IF THEY HAVE NOTHING SPECIFIC IN MIND TO PREPARE (41% VERSUS 31% OVERALL).

Their main motivations for recipe usage are to:

Expand their Create unique dishes they food repertoire have adapted from recipes

Millennials pride themselves on being educated consumers who like to research products before purchasing. Specifically, they like to look up product information, compare prices and read consumer reviews.Source: Ipsos UU Conversations with… Millennials, December 2013

Source: Ipsos FIVE Syndicated Study 2013

Catch Them While You Can

Four Generations in the Aisle

4

87 107 132 200

$252.60 $323.10 $295.50 $263.70

Usually on hand

Purchased specifically for this meal

Purchased for another meal or reason

Wanted to try something new

Millennials Generation X Baby Boomers Silents

Millennials are busy, well-educated foodies who enjoy exciting culinary experiences at home and on-the-go. Ipsos research shows the time is ripe for retailers and brands to connect with them in authentic ways.By Catherine Yuile

How generational differences impact grocery shoppingMillennials have more choices available to them than any previous generation had, and they enjoy experimenting with new brands and appreciate receiving personalized offers. Because of technology, they are an informed and connected consumer, yet Millennials are increasingly feeling overwhelmed by this abundance of choice.

Two new syndicated Ipsos studies, FIVE and Conversations with… Millennials, reveal interesting insights into Millennials’ attitudes, beliefs and eating habits that offer key opportunities for retailers and brands to connect more deeply with this growing and important cohort.

Our research shows that Millennials are foodies and are open to being connected with in an authentic way; one that can help them navigate their preferences in and out of the store.

Success strategies include:

• Offering new product and shopping options that are relevant to their individual needs;

• Appealing to their desire to seek out exciting culinary experiences, which are personalized to them and backed by a strong human connection.

The wide variety of ages, life stages, and unique generational viewpoints in the marketplace is unprecedented.

Four Generations in the Aisle, a report on U.S. consumers by Acosta Mosaic Group, concludes that engaging the

various generations effectively, while not alienating other generations, will require retailers and manufacturers to

have highly tailored messages that appeal to each target generation’s distinctive values and preferences.

THOUGH MILLENNIALS DO PREPARE AND CONSUME MOST OF THEIR MEALS AT HOME, THEY OVER-INDEX ON RESTAURANT MEALS (DINNER/LUNCH), WHILE ALSO BUYING TAKE-OUT FOOD TO EAT AT HOME OR ON-THE-GO.

MILLENNIALS ARE LESS LIKELY TO PANTRY LOAD, PREFERRING TO BUY FOOD FOR SPECIFIC MEALS OR BECAUSE THEY WANT TO TRY NEW THINGS.

Millennials Gen X Boomers Seniors

Food-to-Go consumed at home 133 133 89 56

Sourced at restaurants & consumed at home 125 100 125 75

Consumed at restaurants 159 100 110 143

Food & Beverages are…

>120 Above Index, <80 Under Index Source: Ipsos FIVE Syndicated Study 2013

MEALS EATEN IN RESTAURANTS

Breakfast 50

Morning Snack 68

Lunch 182

Afternoon Snack 62

Dinner 277

Evening/Late Night Snack 64

INDEX

HOW ARE MILLENNIALS INDEXING?

CATHERINE YUILE is a senior vice-president with Ipsos ASI, leading the client service team overseeing pre-testing and in-market tracking. Catherine is Ipsos ASI’s global expert on ad transferability across borders.

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SHOPPERS BY GENERATION

AVERAGE # OF SHOPPING TRIPS

TRIP TYPE

SHOPPING STYLE

CHANNEL PREFERENCE

HIGH INDEXING CATEGORIES

Millennials (Born 1982-early 2000s)

4.1 34% make stock-up shopping trips; 33% make fill-in trips

Heavily influenced by friends and social/community; not brand loyal; shop the store perimeter.

Club and drug stores

Diapers, baby needs, toys, sporting goods, shaving needs, dry prep foods

Generation X (Born 1965-1981)

3.9 44% make stock-up trips; 42% make fill-in trips

Knowledgeable shoppers who use information to help guide decisions. They want to make the best possible choice.

Grocery and dollar stores

Diapers, baby food, baby needs, breakfast foods, dry prep foods, frozen appetizers

Baby Boomers (Born 1946-1964)

3.6 41% make fill-in trips; 36% make stock-up trips

Brand loyal; respond to products/retailers that address the question “What’s in it for me?”

Grocery and club stores

Tobacco & accessories, ice, beer, charcoal logs, tea, pet care, pet food

Silents (Born 1925-1945)

3.6 37% make fill-in trips; 36% make last-minute trips

Brand loyalists who buy what they've bought before.

Drug and dollar stores

Books & magazines, floral & gardening, vitamins, wine, nuts, medication, remedies and health aids

Average Monthly Grocery Spend (US$)

2726 grocerybusiness.caJanuary | February 2014

extraspecialThe grand opening of the Sobeys extra store in the upscale community of Burlington, Ont., last November marked a milestone for Marc Poulin, president and CEO of Sobeys Inc. and its parent company Empire Company Limited.

With the launch of the extra format, Poulin, a 30-year veteran of the food retailing, packaged goods, and financial services industries – and a chess master to boot – is making a strategic move into the fast-growing realm of elite grocery offerings. As the hyper-competitive grocery retail landscape continues to polarize into discount,

convenience and premium/specialty formats – leaving the middle ground in no man’s land – Sobeys is pulling out all the stops to provide an exciting and entertaining shopping experience, and betting that its well-heeled customers are willing to pay more.

Poulin discussed this strategy – and much more – when he met with Grocery Business at the grand opening of the Burlington store.

By Marjo Johne

Grocery Business: Why did Sobeys launch the extra concept?

Marc Poulin: From Sobeys’ perspective, it’s about executing different concepts tailored to the different needs of Canadians who we believe want to enjoy great food every day. For instance, IGA Express and IGA Mini concepts represent our efforts at redefining the convenience food sector so we can bring a fresher food experience to Canadians. In the same way, we believe that Freshco is a better proposition in food discount.

We want to bring solutions to consumers, and that requires our presence at every phase. And you’ll see in this extra store that we’ve put a lot of emphasis on time savers. For instance, a lot of meat has been prepared so you just need to put it in the oven.

There’s also been a lot of work done on the employee side so they are better trained and have better food knowledge, with an emphasis on how to share that knowledge with our customers. I hope this will show that Sobeys has a great passion for food and we want to share that passion with Canadians.

GB: How is the healthy food strategy playing out?

MP: Our connection with Jamie Oliver is one example. We already had Jamie Oliver products in our stores, and when his people listened to our vision, they all got excited because they said that’s very much the same commitment to good food that their team has.

GB: Sobeys recently purchased Safeway; will you retain the banner?

MP: We haven’t made a decision on that. We need to study consumer perception, and after we’ve done that, we’ll make the right decision.

GB: What Safeway synergies do you see for consumers?

Safeway is very strong in pharmacy, and we’re going to learn from that. We’ll bring opportunities – like in this extra store, which has a well-being centre – into other stores.

GB: We’ve seen a lot of Sobeys activity in the convenience sector recently; can you elaborate?

MP: We will eventually expand Needs in Atlantic Canada, and with the acquisition of 250 Shell Canada gas stations in Atlantic Canada and Quebec two years ago, we dramatically increased our convenience food business. One big advantage of a company like ours is we can test one part of the country and, once issues are resolved, we can bring the concept to other parts of the country.

AND NOW FOR SOMETHING EXTRAWhen Sobeys opened the doors to its Burlington, Ont., store after months of extensive renovations, it also introduced a concept that advances the company’s mission to deliver better food and meal solutions to Canadians. Designated as a Sobeys extra store, the 58,000-sq.-ft. location features additional services, departments and products to help customers make better, healthier food choices. These include:

• Extra experts such as an in-store chef, a well-being counsellor, and a cheese ambassador;

• A special events centre to host classes and other events focusing on better food and healthy eating;

• Expanded product selections in key departments such as bakery – which now carries more artisanal breads – ready-to-eat or heat, produce, meat and seafood, cheese and deli;

• Extra savings on essential items such as milk and eggs, as well as monthly price checks on more than 3,000 products.

PHOTOGRAPHY: MATTHEW PLEXMAN


GB: As consumer adoption of online shopping grows, how do you think bricks-and-mortar retailers can win in this changing landscape?

MP: There’s a lot of talk about Amazon but we’ve been in the online business for a long time. Twenty years ago, we launched iga.net. Working on that front, we realized that food shopping is not a single-channel experience. The grocery store, convenience store, and online store are all part of the experience.

GB: What do you feel is the largest challenge that the industry is facing?

MP: The industry currently has to think about how we will bring value back to Canadians. A big part of it is, yes, cost control and delivering great prices to Canadians.

GB: What advice would you give to young people considering grocery retailing as a career?

MP: People often neglect grocery retailing as a career path. They don’t see the breadth of opportunities we offer, and that the food industry is multi-dimensional. It’s also very rewarding, especially from an emotional perspective. There's no industry that interacts with the customer three times a day like we do.

Born: Quebec City, August 26, 1961

EDUCATION

Bachelor of actuarial science from Laval University (1982)

Master of management (marketing) from the J.L. Kellogg Graduate School of Management at Northwestern University in Chicago (1985)

MANAGEMENT ROLES

1985-1986: Marketing – Unilever Canada

1986-1993: Senior marketing and merchandising roles at Provigo Inc.

1994-1995: General manager role at Culinar Inc.

1995: Vice-president of corporate marketing at Desjardins-Laurentian Life Group

1997: Oshawa Group, vice-president of grocery merchandising. The Oshawa Group was acquired by Sobeys Inc.

1998: Poulin became president of operations at Sobeys Quebec in 2001 and, in 2011, president of the IGA operations business unit.

2012: President and CEO of Sobeys Inc.

December, 2013: Expanded his role to president and CEO of parent Empire Co. Ltd.

PERSONAL TIME

Serves on the board of directors of Montreal Heart Institute Foundation; past president of the Quebec Chess Federation; and member of the Montreal Board of Trade.

In 2010, Poulin was recognized by Perform Quebec as one of Quebec’s top business leaders.

Poulin and his wife Ginette Côté have two children in university.

VITALSTATISTICS

According to MarcI was supposed to be an actuary but ended up also doing an MBA in marketing at (Northwestern University’s) Kellogg School of Management. It’s a funny thing, but Eric La Flèche (CEO of Metro Inc.) and Pierre Karl Peladeau (CEO of Quebecor) were in the same class.

Marcel Côté hired me when I was a student to work in his consulting firm. He made me realize my true calling in life was in business rather than as an actuary. By a strange twist of fate, later in my career, I ended up joining the Oshawa Group, and Oshawa was bought by Sobeys (through Empire). Marcel was on the Sobeys board. Over the years, he guided me and introduced me to people.

A TRADITION OF INNOVATION.

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K-FLEX


$ Sales % $ Share $ Vol % Chg

SHRIMP 34,680,271 5.5 66

MACKERAL 2,355,489 0.4 45

STEELHEAD 9,532,838 1.5 27

TUNA 5,887,291 0.9 16

COD 21,860,284 3.5 13

LOBSTER 98,964,280 15.7 13

OYSTERS 7,083,562 1.1 12

SCALLOPS 19,359,990 3.1 9

SALMON 247,170,271 39.2 8

HALIBUT 13,432,164 2.1 7

Fresh fish continues to capture consumer interest, as the latest Nielsen numbers indicate. To increase turns and reduce shrink, consider these display suggestions from Chuck Anderson, Sousa Seafood, Boston:

• Use high and low display shelves to create visual interest.

• Place fish of contrasting colours and textures next to each other.

• Consider what your customer is seeing when looking at the display case. Is it the red meat of the salmon or the skin edge?

• Rather than displaying your entire product in the morning, put out smaller quantities and continually refresh as the day goes on.

TOP GROWTH DRIVERS – FRESH SEAFOOD

Fresh Seafood Total Sales*

REELING IN

What’s hot in frozen value-added seafood? » “Speed scratch” items are a hot option in frozen

seafood. These pre-marinated, cooked or seasoned products are very popular with consumers, giving them the head start they’re looking for in the kitchen, while still allowing them to customize their meals and make them their own.

» Cross-merchandising with complementary items like pasta or salads helps to promote value-added seafood as a meal component, while providing home chefs with the ability to add their personal touch.

» Sampling is absolutely key to initiating sales in the category. These programs boost sales and create an overall lift. In-store demos are great, as they give customers the opportunity to trial the product prior to purchase, while also allowing the retailer to demonstrate ease of use and preparation.

— Jeff Duffin, vice president, marketing, Clearwater Seafoods

Finding Value in Frozen

According to Louis Baus, of Alaskan Water Seafood, consumers are choosing frozen value-added products because of…

Safety: When seafood is frozen and stored at appropriately low temperatures (at least -10° F), bacterial growth is arrested, preserving the product and dramatically extending shelf life.

Economy:High-quality frozen fish is easier to inventory and less expensive than fresh.

Variety:There is a wide range of frozen seafood, including value-added forms like breaded/battered and complete dinners.

As the healthy eating trend continues to impact every aspect of Canadians’ diets, the demand for fresh and value-added seafood is growing at a historic pace. Convenience and health are an unbeatable combination, creating a unique opportunity but also some challenges for retailers looking for ways to maximize sales of both fresh and frozen products. We turned to our panel of experts for ideas on how to hook the consumer on your seafood products.

Shelf Life

PerspectiveFresh

Seafood Sales

Powered by:

$629.8 M 10%10%$ Vol Chg

Frozen Seafood on Display

• Display the front of the package in the bunkers, so consumers can see a clear visual of the product.

• Create P.O.P. with impact. Colourful signage with high-quality food photography tells a sales story.

• Drive impulse purchases and increased consumption with on-shelf ad pad programs that have recipes and coupons.

— Joe Castaldi, senior partner, Brand Marketing & Communications Group

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OF INNOVATIONYEARS

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3

It’s one of the world’s most iconic and enduring

consumer-packaged-goods companies.

Recently marking 100 years since it was

launched by five partners with only $500 in

seed capital, Clorox remains as familiar as ever

to consumers in North America and around the

world. But the company that was forged in 1913

with its unmistakable diamond trademark has

also evolved and expanded well beyond its

seminal product. Today, Clorox is more than

bleach; it’s a vast family of products that make

“everyday life better, every day.”

“Clorox used to be a single-brand,

single-product company,” says Don Knauss,

Chairman and CEO of The Clorox Company,

headquartered in Oakland, Calif. While most

consumers recognize the name, many don’t know

that Clorox is more than bleach. How much more?

Try 64 brands. In addition to its bleach products,

The Clorox Company’s portfolio includes 24 U.S.

brands and 40 international ones. The business

has grown over the century into a $5.6-billion

operation with about 8,400 employees world-

wide, 39 manufacturing plants, and markets in

more than 100 countries.

What’s perhaps most surprising is the

diversity of the Clorox product portfolio. From

Green Works to Glad, Hidden Valley to Kingsford,

Burt’s Bees to Brita, Clorox products cover

practically every part of the home. In addition,

with its line of professional and commercial

cleaning products, Clorox has extended its

presence in the community – into schools,

hospitals, and food-service establishments.

Today, says Knauss, all Clorox products boast

leadership in their category, and are often used

by retailers to generate in-store traffic and bring

innovation into their categories. The

company’s strategy is simple: build big-share

brands in mid-sized categories. “Today, 90

per cent of our product portfolio is made

up of either No. 1 or No. 2 brands.”

Just as it made Clorox into the

world-leading name for bleach, The Clorox

Company today continues to focus on

building the brands in its portfolio. “The best

thing we can give retailers is a brand that

sells,” says Knauss. “And this company is

very good at building brands.” Last fall, the

company revealed its 2020 Strategy for

long-term profitable growth through

greater employee engagement, enhanced

consumer marketing, continued focus on

R&D, expansion into new categories, channels

and countries, and further waste reductions

in the company’s operations, products and

supply chain. “You will see an even more agile

enterprise focused on making sure all the

work we’re doing results in something the

consumer values,” says Knauss. “There’s a lot

to look forward to in the next 100 years.”

More than Bleach

The business has grown over the century into a $5.6-billion operation with about 8,400 employees worldwide, 39 manufacturing plants, and markets in more than 100 countries.

“I worked in Canada, and most of our management team there are

Canadians. One thing we understand very clearly is that it’s not the

51st state. We are very respectful of the uniqueness of Canada in

terms of its customs, consumers and regulatory environment.”

- Don Knauss, Chairman and CEO, The Clorox Company

2

5

a development that also meant less water needed in

production and fewer trips from the plant to retailers’ shelves.

“The compaction of bleach allowed us to save over 50

million gallons of water a year, and also reduced the weight

that we need to ship,” says Knauss. “At the same time, there’s

more efficacy for the consumer in terms of use of product.

So it’s a big environmental win, and a big consumer win.”

Another recent market success for Clorox is Glad Trash

Bags with Febreze. Clorox leveraged its deep consumer

insights to develop a solution that meets consumers’ need

for odour elimination in their waste. The company was able

to partner with Procter & Gamble Co. to infuse Glad trash

bags with Febreze scents. Combining the strength of Glad

with the odour-eliminating technology of Febreze has resulted

in strong growth in a very mature category.

Clorox’s recent launch of Brita Bottles has expanded

the water filtration category, allowing consumers to filter their

water while “on the go.” For the many consumers who filter

water in their home, there was no option to do this away

from home. Clorox developed a line of reusable water

bottles with replaceable filters, reducing the need for bottled

water. Consumers were asking for Brita water while on the

go, and Clorox delivered.

Last year, responding once again to consumers’ desire for

products that deliver quality and value, Clorox launched its Smart

Tube Technology, designed to dispense the very last drop of

Clorox spray cleaners.

“Consumers often complain that they can’t spray the

product at the bottom of the bottle,” says Knauss. “So we

listened to them and created a Smart Tube that’s wrapped and

built into the side of the bottle, and can get right to the product

at the bottom.”

For Clorox, says Pilato, innovation is part of the corporate

DNA, and a key driver for growth today and in the future. To

enhance its ability to capture and execute on the next big idea,

Clorox has established an open innovation program that taps into

partnerships with inventors, universities and other companies.

The company has also set up external networks and forums for

consumers and anyone with a bright idea that can lead to

meaningful new products.

“We leverage innovation to grow mature categories and

define new ones,” says Pilato. “Our mission statement is ‘making

everyday lives better, every day,’ and we do that by constantly

coming up with innovative products.”

“To deliver on our mission of making everyday lives better every day, we relentlessly focus our innovation efforts on solving consumers’ and customers’ unmet needs.”

- Chris Vickers Tucker, President, Clorox Canada

Chris Vickers Tucker and Mike Pilato.

4

Innovation continues to drive the company as it

enters its second century. Today, Clorox invests

two per cent of annual sales in research and

development. Two years ago, the company

invested $50 million on a new, state-of-the-art

innovation centre that houses about 1,000

scientists, as well as Clorox team members from

departments ranging from sales and marketing

to finance and product supply.

“What we found is your ability to innovate

increases when you put the different functions

together in the same physical space,” explains

Knauss. “With the new centre, our scientists are

constantly interacting with people who can help

them define what problems we’re supposed to be

solving. For example, our sales and marketing

people who are on the frontlines every day can

provide insight into customers’ issues, while our

product supply people can share ideas on how we

might improve our processes.”

The company’s diverse portfolio of brands

also gives it a competitive edge in research and

development because technology and know-how

can often be applied across brands and product

lines. For example, a technology used in Hidden

Valley Salad Dressings helped Burt’s Bees make body

lotions that naturally moisturize for up to 24 hours.

The company’s commitment to research and

development has yielded an impressive array of

industry-leading innovations, each designed to

respond to consumers’ desire for quality and value.

Clorox gave the world disinfecting wipes, and

transformed bleach into an ultra-concentrated product

that delivered better results in smaller quantities –

OF INNOVATIONYEARS

From ingeniously redesigned spray bottles to groundbreaking product categories, unique innovations have

shaped Clorox’s 100-year history. The company has consistently led the way over the last century by turning

smart ideas into products that enhance life, solve everyday problems, and grow categories. “We really leverage

innovation across The Clorox Company,” says Mike Pilato, Vice President of Sales for Clorox Company of Canada.

“From new products to product and supply chain improvements, we’re always looking for ways to do things better.”

Revitalize floors, kitchen counters, and add a burst of morning freshness to your bathroom surfaces with NEW Pine-Sol® Mandarin Sunrise™ Multi-Surface Cleaner. It is safe on wood*, and cleans and deodorizes with the power you expect from Pine-Sol®, leaving behind a long-lasting, invigorating citrus scent, so you know your home is clean.

*Not recommended for wood that is unfinished, unsealed, unpainted, waxed, oiled or worn

The most trusted brand of bleach for your laundry now comes in smaller, easier-to-use packages that have all the cleaning power of bigger bottles. The new concentrated formula of Clorox® Bleach is easier to pour*, and allows you to get the same number of uses with all the great cleaning and whitening results you expect from Clorox® Bleach.*Vs. previous Clorox® Bleach

Clorox® Bleach Foamer is an innovative bathroom cleaner that delivers serious cleaning with less scrubbing for your bathroom surfaces with its foaming bleach action. The revolutionary new spray bottle uses the patented Smart Tube™ Technology by Clorox® to deliver better value, reliability and usage experience for you.

Formulated especially for high-efficiency machines, the NEW Clorox® Bleach Gel for Laundry is a thick bleach gel that comes in an easy-to-grip container with a precision pour spout. This minimizes splashing and gives you better control to clean, whiten and remove stains.

INNOVATION FOR THE AGES

NEW Clorox® Disinfecting Wipes On-the-Go is a convenient, re-sealable pack of 34 fresh-smelling, disinfecting wipes. These wipes kill 99.9% of house-hold bacteria, making this To Go pack great for cleaning and fighting germs both inside and outside of your home. Pack them when you travel, keep them in the car or stash them in your purse — anywhere dirt and germs may build up throughout the day.

NEW Clorox® Kitchen Cleaner is a floral scented kitchen cleaner with bleach that cleans tough messes and is safe for use on granite and stainless steel. The revolutionary new spray bottle uses the patented Smart Tube™ Technology by Clorox® to deliver better value, reliability and usage experience for you.

Clorox® All-Purpose Disinfecting Cleaner is a bleach-free and streak-free spray cleaner that cuts through grease and grime throughout the house. Equipped with Clorox®’s revolutionary new Smart TubeTM Technology bottle, it delivers better value, reliability and an overall better usage experience.

NEW Liquid-Plumr® Hair Clog Eliminator™ is specifically designed to eliminate tough hair clogs. It clears partial hair clog in 15 minutes to restore the flow in your drain, and is safe for all pipes, basins/sinks and septic systems.

Glad® kitchen catcher bags with febrezeTM freshness help to neutralize kitchen trash odours. And with the Easy-Tie® closure, you just tie, grab and toss.

Don’t go around in circles looking for the lid! NEW GLAD® MatchWare™ containers solve the mismatch problem with easy colour-match lids that perfectly complement patterned containers.

NEW GLAD® Stand-up bags enable the bag to stand upright for more space and storage capacity. Bags are available in three sizes: small, medium and large.

INNOVATION FOR THE AGESBurt’s Bees® Brightening Dark Spot Corrector – Infused with Daisy Extract, this dark spot correcting serum is the perfect natural solution for creating a luminous complexion. Clinically proven to even skin tone, 80% of women saw diminished appearance of dark spots and discolouration after using Burt’s Bees® Brightening Dark Spot Corrector.**After 8 weeks of use.

Give hair a foaming, cleansing experience that’ll leave it smelling smelltastic with güd Pearanormal ActivityTM

Natural Nourishing Sham-poo. Created by the makers of Burt’s Bees® with the of-the-moment woman in mind, the new collection includes all the “güd” stuff of sunshine and laughter, none of the bad. No parabens, no phthalates, no petrolatum, never tested on animals – No way!

Following the launch of the squeezable Brita® Bottle and Kids’ Bottle, the new Brita® Hard Sided Bottle comes with a firm exterior and built-in straw and filter to allow for easy drinking and portability.

Glad® compostable bags provide the quality and strength you need to hold all your kitchen scraps and green bin items. GLAD® bags are BPI certified, and neutralize odours with the power of febrezeTM freshness, helping to eliminate even the smelliest kitchen odours.

Introducing a slice of high-end water filtration design. The new Brita® Stainless Steel Water Filtration Pitcheris a space-saving solution that fits perfectly in today’s modern kitchen, whether in the refrigerator or on the dinner table.

Burt’s Bees® Lip Shimmer A kiss of colour and pearlized shine add a hint of glamour to our world-famous lip balm. Nourish, moisturise and soothe your lips with natural ingredients like vitamin E, and coconut and sunflower oils. Choose one of 10 classic shades or try our two new vibrant looks for 2014: Apricot, a trendy coral; and Grapefruit, a frosty light pink.

9

“We needed to find a way to get a lot of bleach out to various organizations such as the Red Cross and to retailers

who told us they needed to increase their inventory. We focused on the task for two days, and made sure as much

bleach as possible got to Alberta. It was an amazing thing.” In the end, Clorox gave Albertans 25,000 bottles of

Clorox bleach and 24,000 boxes of 100-count Glad trash bags. It wasn’t the first time Clorox has come to the aid of

communities – and it won’t be the last.

From its early years, Clorox made a commitment to be a good corporate citizen – one that does the right thing

for its community. Its first recorded act of corporate giving dates back to 1921, when it donated funds to the Boy

Scouts of America. Over the decades, Clorox has continued to do the right thing – from supporting family health and

education to being there to help when disaster strikes communities. “We have a core set of values that we live and

breathe every day,” says Pilato. “Doing the right thing is one of those values, and

it’s something we continually emphasize and live by every day.” Clorox formed

The Clorox Company Foundation in 1980, with a mandate to fund programs that

serve youth, education, and cultural and civic groups. Over the last three

decades, the Foundation has given more than $91 million in cash grants to

non-profit organizations, schools and colleges.

Clorox also encourages and supports employee giving to the community

through its GIFT (Get Involved for Tomorrow) Campaign – a program that sees

Clorox match employees’ donations to any non-profit organization. “We raised

$4.5 million for our most recent GIFT Campaign,” says Knauss.

Whether it’s donations of money, time or products, Clorox and its employees have been there to pitch in when

needed. In recent years, they’ve helped victims of Hurricane Ike in Texas, Superstorm Sandy in the eastern United

States, and the Great Flood in Alberta. Last year, the company sent 48,000 litres of bleach to Argentina, where

nearly 500,000 people were affected by floods. It also continued to help fight a cholera epidemic in Haiti, sending a

second donation of more than 1,000 cases of Clorox bleach to the Caribbean country.

When Typhoon Haiyan hit the Philippines, Clorox immediately gave $150,000 to the American Red Cross Pacific

Typhoon Fund, and donated thousands of litres of bleach. The company also provided relief goods for families of

distributors affected by the typhoon. “Clorox is truly a part of the local and global community, and we believe we

have a role to play in strengthening our communities,” says Pilato. “I feel really proud to be part of this company.”

Clorox formed The Clorox Company

Foundation in 1980, with a mandate

to fund programs that serve youth,

education, and cultural and civic

groups. Over the last three decades,

the Foundation has given more

than $91 million in cash grants to

non-profit organizations, schools

and colleges.

William Osler Health System Foundation Habitat for Humanity Supporting Youth Together we make a difference

8

T he Clorox Company

was in the thick of

year-end activity when

the Great Flood of 2013

devastated large swaths

of Alberta, forcing

thousands of people

to flee their homes.

“We literally just stopped

what we were doing in the

middle of year end and

said, ‘we have to do the

right thing now,’” recalls

Mike Pilato, Vice President

of Sales for Clorox

Company of Canada.

community commitment

the

RIGHTthing

Doing William Osler Health System Foundation

Clorox Canada employees celebrate the company’s 100 year anniversary

helping consumers reduce their use of bottled water, saving

energy as well as the use of petrochemicals to make plastic.

With Burt’s Bees and güd, Clorox promotes the use of

personal-care products made with natural ingredients and

packaged sustainably using recycled and bio-degradable

material.

For the Glad business, new technology is being used to

remove 6.5 per cent of the plastic required to create the

brand’s base trash bags, diverting 6.5 million pounds of plastic

from landfills, or the equivalent of 140 million trash bags per

year. Clorox has steadily reduced packaging material for its

Glad trash bag over recent years. A large percentage of

product packaging and retail display material is now made

with recycled content.

Clorox is also leading the sustainable charge with Glad

compostable bags – an innovation that is proudly made in

Canada. Instead of putting their compostable food waste

straight into bins – which inevitably become smelly and

slimy after a few days – many Canadians are now lining their

food waste containers with Glad compostable bags, which

decompose along with the organic waste at their municipal

composting facility.

To help ensure this innovation accomplishes its primary

goal – to encourage more Canadians to compost – Clorox

worked with municipalities across the country to make sure

the new bags would be accepted by all composting facilities.

“We were the first country to launch Glad compostable

bags in the marketplace,” says Pilato. “This product today

is a market leader and remains unique to Canada.” Pilato says

the company has also been helping to develop waste diversion

programs across the country for the past 15 years.

Recognizing that consumers are most likely to recycle

when armed with the proper material and tools, Clorox works

to ensure retailers’ shelves are well stocked with whatever

recycling material their communities need – whether that’s

blue recycling bags, compostable bags, or clear bags. “So

when consumers walk into their local retailer, they’re buying

products they can actually use because the retailers’ shelves

are aligned with local recycling programs,” says Pilato.

These efforts are just a few examples of the many ways

Clorox is helping to protect the environment, says Knauss.

With environmental sustainability built right into the

company’s business model, retailers and consumers can

expect more good things. “We’re making significant progress

on our commitments,” says Knauss. “And we’re continuing to

push towards our goals.”

1 1

We were the first country to

launch Glad compostable

bags. This product, today,

remains unique in Canada.”

- Mike Pilato

1 0

The world’s leading provider of cleaning products

also works hard at keeping the planet clean

and green. As it has grown its business over the last

century, Clorox has put in place programs and

practices to reduce its impact on the environment.

“Environmental sustainability is integral to

how we do business,” says Knauss. “Through

our environmental sustainability strategy,

we work to reduce the impact of our

operations and of the products we make.”

As part of this strategy, Clorox defined

its commitments to reducing greenhouse

gases, waste, paper, water and energy use,

and to ensuring its manufacturing opera-

tions do no harm to biodiversity and natural habitats. From 2007

to 2012, the company saw improvements in all areas, with

reductions of 26 per cent in greenhouse gas emissions, 22 per

cent in water use, 27 per cent in solid waste to landfill, and

15 per cent in energy use.

At the same time, Clorox concentrated its Clorox bleach

formula by about one-third, reducing the product’s overall

carbon footprint while delivering greater convenience to the

consumer. The company’s commitment to protecting the

planet extends across its entire product portfolio. Green Works

products, which derive at least 95 per cent of their ingredients

from natural sources like coconuts and lemons, hold the

distinction of being the first natural cleaning line made by a

major consumer packaged goods company to be featured in

the mainstream cleaning aisle.

Through its Brita pitchers and reusable bottles, Clorox is

“Over the years, we’ve reshaped

Clorox into a health and wellness

company. With brands from Burt’s

Bees and Brita to Hidden Valley,

we’ve broadened our definition

of health and wellness to

Clorox products being

around me, in me,

and on me.”

- Don Knauss

Driving Sustainable Strategies

Embracing diversity and

multiculturalism isn’t new

to Clorox. As early as the

1920s, the company printed

instructional pamphlets on the home use of Clorox bleach in

French, German, Italian, Polish, Spanish and Yiddish – all for

consumers who were living in the United States. Today, says

Pilato, Clorox continues to find ways to connect with its

diverse markets. Two years ago, for instance, the company

invested significant resources to learn more about Chinese

and south Asian consumers in Canada. The findings helped

Clorox ensure it was marketing products that were relevant

to these consumers. “We found insights that really helped to

drive the business,” says Pilato. “For example, we uncovered

insights on the importance of water in the Chinese culture, so we decided to focus on Brita in that community.

We launched a new Brita pitcher that celebrates Chinese New Year, and have engaged in an entire sponsorship

program of Chinese events. We’ve seen tremendous growth in Brita sales among this demographic as a result of

our efforts to understand and build relationships in this community.”

Focus on diversity

1 2

Hunter Straker

1 5

A commitment to delivering great products has propelled The Clorox Company

to success over the last century. But there’s another element that’s been critical

to the company’s growth: a corporate culture focused on nurturing strong

relationships with employees, suppliers, retailers and consumers.

The company that established its brand by giving samples of its original

product to homemakers continues to believe in the human factor as a key driver

of business. “This company has an amazing people-focused culture that really

sets it apart from other companies,” says Pilato. “I think anyone who works here will tell you how valued they are.”

Knauss points to the four values that define

the company’s culture: do the right thing, stretch

for results, take personal ownership, and work

together to win. These values challenge Clorox

employees to work individually and collectively

to achieve the best results for the company, but

always with integrity and accountability.

Ultimately, says Knauss, the company’s culture

is built on respect. “Fundamentally, if you have

basic respect for people, it drives engagement,”

he says. “We have smart people everywhere in

the company; let’s respect them and let them

get their ideas forward.” This also means

respecting – and encouraging – diverse thinking.

Clorox also puts great value on its

relationships with suppliers, business partners and retailers. Many of these relationships have lasted for decades. For

example, the lead ad agency Clorox uses today can trace its roots back to the first ad agency that the company hired

during the Roaring Twenties. Clorox also has relationships with food brokers that date back 90 years or more. “At the

end of the day, we’re really all about people,” says Knauss. “The most important assets we have are people – they

created the brands, so there wouldn’t be any brands without them. And without the relationships we have with our

suppliers, our retail partners, and our consumers, The Clorox Company wouldn’t be here today.”

A culture of respect & strong values

“This company has an amazing people-focused culture that really sets it apart from other companies.” – Mike Pilato

1 41 4

from your friends at

100congratulations

on yourth

anniversary

clorox

“Receivable Deduction Specialists”

Philip Covshoff, PresidentTel: 416-409-8640 • Email: [email protected]

www.claimsrecoverygroup.ca

Congratulations

Great Years!

CLOROXON

100From Your Friends At

Chris Vickers TuckerPresident

Darren BowenVice President Product Supply

Lori Galati Aguiar Vice President

Human Resources

Katie RennerVice President

Cleaning

Faroek Hanif Vice President

Finance

Soula Kioussis Vice President

Specialty

Mike Pilato Vice President

Sales

Guido Romagnoli Vice PresidentProfessional

Products Division

1 7

Mike Pilato Vice President

Sales

Chantal Gagne Sales Director

Jim Slomka Sales Director

Ken Anderson Sales Director

Heather Edgar Sales Director

Brent Falvo Sales Director

Scott MacLaughlin Sales Director

Bobby Ramnarine Manager of Sales

Finance

John MarleySales Director

Robert Brunet Sales Director

Clorox CanadaStrategic Leadership

SALES LEADERSHIP TEAM

CANADIAN LEADERSHIP TEAM

1 6

would like to CONGRATULATE

CLOROX

anniversary

on its

th

and its membersu n i t e d g r o c e r s i n c .

1 9

Since its first jug of bleach came down the factory conveyor belt in 1913,

Clorox has grown into the most trusted name in household cleaning and

laundry products. But did you know that Clorox products were originally

created for commercial sanitizing and disinfecting?

Today, this century-old heritage lives on with the company’s Professional

Products business, which has a portfolio that includes top brands for

professional infection control, as well as for food service and commercial

cleaning and maintenance.

“We saw an opportunity to leverage our expertise in disinfecting

products to address the needs of healthcare facilities and food-service

establishments,” says Knauss. “Today, we have a great lineup of professional disinfecting products that kill

germs that make people sick.”

In Canada, Clorox’s professional products range from Clorox Healthcare disinfectants to Pine Sol and S.O.S.

cleaning solutions and steel-wool soap pads. These products – most of which are Health Canada-registered

disinfectants – can be applied in a variety of professional and commercial

settings, including hospitals, long-term-care facilities, doctors’ and dentists’

offices, childcare centres, schools, offices, and restaurants.

“We’ve branched out from being a company that sells to retailers into

an organization that sells to hospitals, doctors’ offices, restaurants, hotels

and other institutions,” says Knauss. “We’re no longer just in your homes;

we’re also in your community.”

Professional products- Leveraging expertise

18300+ Canadian Employees

CANADIAN BRANDS

7 GLOBAL RESEARCH & DEVELOPMENT FACILITIES

COUNTRIES WHERE CLOROX PRODUCTS ARE MARKETED

100+

$91 MILLION**Amount the Clorox

company foundation has awarded to nonprofits

since its founding in 1980

3 Million+ Fanson Facebook

8,400Employees Worldwide

F RTYINTERNATIONAL BRANDS

FIRST YEAR SALES LA

ST YEAR SALES

$7,996 $5.6B

GLOBAL MANUFACTURING PLANTS

THE CLOROX COMPANY BY THE NUMBERS

1 8

2 0

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More than 70 per cent of consumers look for a box when they need coffee for their Keurig brewers. Keurig’s new box format features bold graphics that instantly communicate “Fits Keurig” to customers. Boxes can be double stacked for greater shelf efficiency. melitta.ca

Astro Original GreekDiscover the indulgent flavoursThick and deliciously creamy, Astro Original Greek yogourt is now available in four decadent dessert flavours: Banana Cream Pie, Cherry Cheesecake, Vanilla Crème Brûlée and NEW Raspberry White Chocolate. Made with natural ingredients, Astro Original Greek is high in protein and gelatin free. astro.ca

Gluten Free BisquickSame great taste, now gluten free

Fisherman’s FriendImproved twin-packs

LIST IT New and now products

General Mills is expanding its gluten-free portfolio with new Gluten Free Bisquick, a versatile mix that’s great for pancakes, waffles, biscuits, and more. Made with rice flour in an entirely gluten-free facility.bisquick.com

New hanging bag twin-packs on Fisherman’s Friend Original Extra Strong and Cherry Sucrose Free lozenges contain two individually resealable packages for increased consumer appeal and convenience. The packs are fully peggable for merchandising in the hanging bag section.facebook.com/FFCanada

Fortun’s Finishing Touch Sauces featuringChef-inspired recipesKevin Fortun and many top chefs combined their creative culinary expertise and spent years perfecting these sauces. To ensure that each recipe starts with the best, the proprietary chicken, veal, or beef stock is roasted right from the bone to become restaurant-quality bases. Rich, authentic, natural ingredients and spices are added at just the right time to complete the chef-inspired finishing touch. alaskanwaterseafood.com


BrandSpark International’s annual Canadian Shopper Study – examining the shopping habits of more than 100,000 Canadians – has found that the majority of consumers are using their smartphones to make purchasing decisions, and most Canadians are committed to living healthier lifestyles.

The survey found that the most recent global economic crisis continues to have an impact on

Canadians’ purchasing decisions, with 33 per cent of respondents saying they are less loyal to companies now than before the last recession.

The BrandSpark Canadian Shopper Study is Canada’s most comprehensive source of insights about Canadian shopping habits for everyday food and beverage, health and beauty, household, and kids’ products.

will stock up when one of their favourite products is on sale

study flyers/circulars, promotions, and discounts before their shopping trips

try to buy enough food to prepare meals for at least 3-4 days

are concerned about food safety

prefer purchasing brand name products that are on sale rather than private-label/store brand products

think that convenient food is usually not the healthiest

think that shopping for food products is a time to explore and learn about what’s available

go to multiple stores to get the best deals

purchase the same brand name products on a regular basis

56% consider it important that ethnic food products are culturally authentic

54% have used their smartphone to make a purchase decision

49% say it takes too long to earn rewards through loyalty programs

33% say they want to be the first person among their friends and family to try new products.

18% rarely cook from scratch when the same thing is available ready-made in the supermarket

The Consumer

91%

78%

71%

76%

68% 64% 69%

86%

82%

KEY SHOPPER ATTITUDES & BEHAVIOURS

consider price to be the most important factor in their food purchase decisions

62%

BRANDSPARK’S CANADIAN SHOPPER STUDY 2014

Three popular whole muscle products now offer more value. Janes Cracked Black Pepper Chicken Strips, Janes Chicken Breast Fillets, and Janes Garlic & Pepper Fillets now include our specially developed Signature Sauce, created especially to enhance the flavour of Janes products. Now in a 1-kg pack.

A proud Canadian brand, Janes makes high quality fish and

chicken products for families looking for nutritious yet convenient meals.

Janes’ fish products are all wild-caught, MSC-certified, whole fillets, never

minced. And our chicken burgers, strips and nuggets are 100% all-white

meat. Other benefits include being trans-fat, preservative and artificial

flavour free, while being low in saturated fat.

Check out some new and some improved products from Janes:

Janes Natural Goodness Chicken Strips and Nuggets Two options for consumers looking for convenient, back-to-basics foods. Minimum ingredients. Maximum taste!

Both of these favourites have been

improved with updated coatings.

Fillet of Sole features a light panko

breading, with a hint of lemon;

Multigrain Haddock has a delicious

breading that includes ancient

grains, quinoa, and millet.

Janes Battered Fish Bites and English Style Fish Value-priced products that are a

source of DHA Omega-3. Battered Fish

Bites are bite-sized pieces of fish, ideal

for dipping or in fish tacos. English

Style Fish are large, battered fillets.

Janes Ultimate Chicken Burger Ready for the grill, this burger is now juicier, with an improved taste and texture.

Introducing Janes Ultimates Battered Chicken Breast Fillets with Signature Sauce – Our newest addition to the Janes family of whole muscle chicken, these tender chicken fillets are wrapped in a light, crispy batter.There is nothing else like it!

Disney Cars Chicken Nuggets 100% all-white meat, these fun-shaped chicken nuggets will appeal to children.

Janes Panko Breaded Fillet of Sole and Janes Multigrain Haddock

Brings you Quality & Convenience

Sofina Foods, Inc.

NEW

NEW

NEW


Custom Publishing with a fresh take

quality content + award-winning design

OUR TURNKEY SERVICES INCLUDE:• Professionally written and edited content

• Custom photography • Award winning graphic design

• Account management • Top quality printing

• Distribution • Promotion

Kevin Smith [email protected]

Karen James416- [email protected]

Dan Bordun [email protected]

If the medium is the message

and the brand message is quality,

then choose Grocery Business Publishing

CONTACT:

01 Dino Bianco, Kraft Foods; Paul Higgins Jr., Mother Parkers; Tim Berman, Kraft Foods

02 Eric La Flèche, Metro Richelieu; Paul Higgins Jr., Mother Parkers; Pierre Lessard, Metro Richelieu

03 Steve Turner, Matt Blixt, Lisa Wernham, Kruger Products

04 Prior Golden Pencil Award inductees

05 François Bouchard, The Country Grocer; Margaret Hudson, Burnbrae Farms

06 Denis Gendron, UGI; Michael Marinangeli, MIDEB Consulting

07 Al Tyreman, AWT & Associates; Karen James, Grocery Business

08 Diane Brisebois, Retail Council of Canada; Eric La Flèche, Metro Richelieu

09 Tim Berman, Kraft Foods; David Wilkes, Retail Council of Canada

10 Ken Schley, Quality Foods; Dino Bianco, Kraft Foods; B.K. Sethi, UNFI

11 Blair Ruelens, Pepsico; Lem Janes, Janes Family Foods, Nancy Croitoru, FCPC

12 Bill McEwan, Elaine Smith, Tim Penner

13 Mike Lovsin, Freson Bros.; Tom Barlow, CFIG; Frank Lovsin, Freson Bros.

14 Bobby Ramnarine, Jim Slomka, Clorox; Michael Marinangeli, MIDEB Consulting; Chantal Gagne, Mike Pilato, Clorox

15 Eric La Flèche, Metro Richelieu; Robert Coallier, Agropur; Shelley Broader, Walmart Canada

16 Anthony Longo, Longo’s; Philip Donne, Campbell Company of Canada

GOLDEN PENCIL AWARDSNovember 25, 2013, Toronto: Dino Bianco of Kraft Foods

and Eric La Flèche of Metro Richelieu Inc. were honoured with the prestigious Golden Pencil Award.

01 02

03

04 1211

14

13

05 06

15

1607

09

PHOTOS: RODNEY DAW

08

10

The

63grocerybusiness.ca62 January | February 2014

Carman Allison is director of consumer insights for The Nielsen Company in Canada, and is responsible for creating thought leadership reports and insights for CPG manufacturers and retailers.

ALL STATS COURTESY: NIELSENCarman Allison

it figures>Focus onLoyalty Programs

Takeaway Where do they spend the other 86% and why? It’s important to understand your consumers’ need state, and then create a loyalty program designed to grow basket size.

Takeaway Know your customers and what drives them. Free stuff appeals more to younger families, while reward points attract older, higher-income crowds. Plan your incentives accordingly, and make them easier to redeem.

Takeaway Loyalty programs drive traffic, so make it a seamless experience and give the consumer the option of a physical card or a digital app to increase convenience and usage.

Takeaway Incentives + in-store experiences are key consumer motivators when consumers decide where to shop.

Takeaway Consumers are more involved than ever in loyalty programs… so how does a retailer stand out? Remember that the experience in the store is the key to repeat trips and a loyal consumer. are more likely to

shop at a store because it offers a loyalty program

The average consumer spends 14% of their shopping dollars in a particular store 97%

of Canadians participate in a loyalty program: +3% from 2008. The average consumer has at least 6 loyalty cards and carries 3 of them in their wallets.

of consumers choose free stuff over reward points

of consumers redeem incentives

Free products trump reward points when talking about loyalty program incentives

28% 69% Only

of grocery cardholders report that they always use their cards

When it comes to loyalty program importance, grocery products come second to gasoline purchases

Gasoline Grocery42%53%

80%

vs.

of consumers consider switching to, or shopping more often in, a store because it offers a loyalty program

20%

47%


®

Vancouver Convention CentreWest Building

Conference April 10 & 11Trade Show April 12 & 13

We’re celebrating 50 years as the voice of the natural health industry.

With a membership of over 1,000 members and an industry that is poised for incredible future growth, we are proud to present our largest Western trade show to-date. If you haven’t

experienced CHFA West, now is the best time to come and see what we are all about.

A must attend event for buyers of natural health products, natural & organic foods, natural personal care and eco household products.

• Discover future best-sellers from hundreds of companies • Engage with more than 650 exhibitors all under one roof• See, taste and compare local and international brands • Enjoy savings exclusive to show attendees• Attend free product education sessions from leading industry figures• Join in the fun at the many receptions and parties

BE AT THE HEART OF THE NATURAL PRODUCTS INDUSTRY

• natural health products • health and beauty • sports nutrition

• specialty food • nutraceuticals • organics

FOR COMPLETE DETAILS AND TO REGISTER VISIT chfa.caCHFA trade shows are not open to the public. Proof of industry status is required in order to gain admission to the conference and trade show.

For additional information on the show and our show policies, please visit chfa.ca

CHFA WestConference – April 10 & 11 • Trade Show – April 12 & 13

Vancouver Convention Centre, West Building

option A - green (PMS 384 + black gradient overprint) & PMS 453 tones

Our Greatest Catch is Quality

YOUR SEAFOOD SPECIALISTAlaskan Water Seafood is an exclusive distributor of unique

quality seafood and proven value added items never before

offered to the Canadian market. Our state of the art in house

cold storage and logistics facility is capable of supplying

and servicing multi-chain national and regional programs.

WE OFFER • AWS Brand of long line frozen at sea chemical free

sustainably caught Halibut, Salmon, Sole, Pollock, Cod

and Haddock fillets and portions

• Fortun Foods gourmet line of soups and sauces

• Pier Fish's extensive program of re-fresh and frozen

value added seafood items

• Year round availability

• Stable Pricing and Quality Guarantee!

• Programs and pricing for evey size of client

TF 1.877.334.3663 P 905.828.FISH (3474) E [email protected] W alaskanwaterseafood.com

250 Summerlea Road, Brampton, Ontario, Canada L6T 3V6

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